Hermès bag gang buys up half the supply

castiel

O.G.
Nov 9, 2009
210
413
A gang accused of buying up half of Hermès’ bag supply as part of an elaborate money making scheme has been caught by Paris police.

The gang is claimed to have hired women to pose as wealthy customers and purchase Hermès bags only to resell them for three times the retail price.

Paris police allege the gang has been making one million euros per month in the scheme.

The women recruited were told to dress in designer clothes to make them appear as wealthy Hermès customers. They were instructed to tell made up stories in order to secure the hard to come by bags, such as claiming they were buying bags for sick relatives.

According to French media, the gang invited possible customers to a fake showroom near Hermès’ flagship Paris store to entice them to buy the bags. A selection of the bags were exported to Asia.

Ten suspects were detained this week. The gang was allegedly working with Chinese nationals. These findings are a result of an 8-month long operation by French police.

The scheme will likely add to Hermès’ growing concerns over customers buying bags with the sole aim of reselling them.

Full story here https://www.thetimes.co.uk/article/hermes-bag-gang-buys-up-supply-paris-jknkkvq6k
 

amateurjeweler

Midas Jr.
O.G.
Jun 30, 2011
385
619
I wonder if they were buying half the supply of the Paris flagship, of French stores, or total. Either way that's crazy.

I admire the brand but I don't understand the decades long hype for their B and K bags. They probably should offer those bags to their loyal customers only. "The Game" is bizarre to me, some people say it's real and some say it isn't, but their other bags and accessories are so nice and honestly more interesting to me that if I really wanted one of those "grail bags" I wouldn't mind buying home goods, scarves, fragrances, and other things for a year or two first. That's what I buy from them anyway.
 

HKsai

Member
Jul 24, 2016
1,655
5,145
They should probably stop offering bags to walk-ins/no purchase history. Definitely not what we want to hear but it affects those who genuinely love the brand. They get the most coveted colors/sizes but are just reselling them for a huge markup.
It’s hard to differentiate sometimes. I know a bunch of “regulars” that buy their bag and kept it for a few months and then sold it on Facebook group.
 

christine728

Member
Mar 6, 2018
252
500
That is wrong and it takes bags from the customers that honestly want them. I save my money , spend all year on items I love
But I still need to keep a relationship going with my SA. But at the end of last year I had slim pickings on offers.

I also know many regular customers that just accept offers even if they do not want to keep the bag. They just then resell for a profit.
Someone I know purchased the bag I declined and now just posted it for sale :sad: I am pretty sure she knew that she would not keep it.
this whole mentality is bothersome. I am not against selling handbags but when the only goal and reason one purchases a BKC is for that purpose, it is not right.
 

Kitty S.

Bags & Sciences
Dec 21, 2012
2,242
350
They should probably stop offering bags to walk-ins/no purchase history. Definitely not what we want to hear but it affects those who genuinely love the brand. They get the most coveted colors/sizes but are just reselling them for a huge markup.
I agree the only way to curtail this is for H to stop offering bags to walk-ins/no purchase history. But this may also limit H from reaching/enticing new customers who may fall in love with H after the first B/K, bc I am one of them, so I am ambivalent on what the recommendation should be... I was lucky to have been offered a K32 on my first trip to Paris and after that I am addicted to H! I am sure H knows the statistics on how successful their practice results in getting loyal customers like me Vs. the risk of selling to resellers and angering their loyal fans. If they don’t, they should hire consultants to run the statistical models. It’s all part of running a good business.
 

AnnaE

Team Scarf Mistress 2021
O.G.
Mar 9, 2011
2,064
13,263
I assume the issue is the gang not paying taxes. The French are pretty serious about protecting their luxury brands, so perhaps Hermes claims they were violating some other law as well.

If they sold for 3x the price, they made an average profit of $15k (I think the price of many ‘standard’ Birkins or Kellies is 7-8k EUR). With a profit of over 1M EUR a month, they must have sold over 60 bags monthly then. If that is half the supply, then the whole supply is 120 bags, give or take. This sounds little too low even for the Parisian supply. Interesting numbers nonetheless.
 

Liberté

O.G.
Jan 5, 2007
8,614
1,661
I assume the issue is the gang not paying taxes. The French are pretty serious about protecting their luxury brands, so perhaps Hermes claims they were violating some other law as well.

If they sold for 3x the price, they made an average profit of $15k (I think the price of many ‘standard’ Birkins or Kellies is 7-8k EUR). With a profit of over 1M EUR a month, they must have sold over 60 bags monthly then. If that is half the supply, then the whole supply is 120 bags, give or take. This sounds little too low even for the Parisian supply. Interesting numbers nonetheless.
I agree. I don't see how it's hard to grasp how this is different from a person reselling their bags or why it's illegal. They were basically running a business, hiring people to get the bags for them by telling lies, they set up a fake show room, which I can't seem to find any more information on because both of the articles I could find on this case are behind paywalls, but they may or may not have implied they are authorized resellers. They more than likely were not paying taxes and filing other paperwork necessary let's say to hire actors. Hermes needs to know whether the party they are selling to is a retail customer or a business, if only because different legislation applies.
People who are reselling a bag not acting as a business is quite a different matter. In some countries you can resell privately held items, consumer goods etc. on quite a scale before it's considered a business, such as stamp and coin collections, pieces of art, purses etc.
 
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